Globalisation is an opportunity to reposition local governments at the heart of territorial development policies

Reacting to the European Commission reflection paper titled “harnessing globalisation”, PLATFORMA believes that this must start locally and involve local governments.

Following the publication of the White Paper on the future of Europe in March 2017, the European Commission released on Wednesday (10 May) a reflection paper in which it seeks to identify ways for the European Union to guarantee a fairer distribution of benefits arising from globalisation.

This paper sets two key dimensions of today’s economic globalisation: that a “laissez-faire” approach has not resulted in an even distribution of benefits and that welfare in Europe is largely based on small and medium sized enterprises (SMEs).

This is what local and regional leaders live through every day: SMEs are the cornerstone of local economies and local societies and they often request support from their local government to deal with the challenges of globalisation.

This situation is not proper to Europe, as countries outside the European Union present the same context: local governments actively interact with the local private sector on many different fronts, including infrastructure, service delivery and economic incentives.

Globalisation is an opportunity to reposition local governments at the heart of territorial development policies. By pointing to the importance of social integration through economic revival of (arriving) citizens, stimulating entrepreneurial spirit and skills, the European Commission recognises the need for local action. But it seems to disregard the key characteristic of a government: the mandate to govern.

To harness the potential of globalisation for local societies and local economies, strong governing skills are needed at the local level. Local elected officials and technical staff need to be empowered to work with the local private sector to guarantee that not only costs but also benefits are collectively and fairly shared.

These core capabilities to engage, to self-renew, to learn and to deliver can only thrive in a context of good multi-level governance. Harnessing the potential of globalisation can only work in a context where the subnational levels of government are recognized and empowered to work on their democratic mandates to govern their respective areas.

In this regard, the European Union must not lock itself within its own borders. Particularly on issues of globalisation, it would be a political and operational mistake not to step-up European efforts regarding international cooperation.

In line with the recognition by the EU of local and regional governments’ contribution to development and in view of the need to intensify their role, this reflection paper should be a jump-off point to actively invest in local governments’ core capabilities for economic stimulation at the local level – in Europe and in EU partner countries.  It should not be limited to technical assistance or export promotion, and particularly should not only focus on promoting investments by European companies.

This reflection paper should address how local governments’ priorities become part of the national development policies. Local governments are already responsible for many programmes and services enabling an effective local economic development by supporting local businesses. This is notably the case in terms of market development, business stakeholders’ forums and the support to local cooperative development. While Public-Private-Partnerships are expanding in the developing world, it is important to keep in mind that local governments are usually the cornerstone of those schemes.

For these reasons, Europe’s towns and regions are ready to engage with the stakeholders in their territories. They are equally ready and motivated to work with their counterparts in Africa, Asia and Latin-America. Although decentralised cooperation is one of the many existing tools that contribute to global sustainable development, and even though direct economic returns from decentralised cooperation for the governments involved is often difficult to achieve, the commitment to build local governing capacities for sustainable development is strong.

Considering the challenges, but also the potential for action brought by globalisation, the European Union should understand that its response must include an international dimension and governance capabilities at all levels of government.